Local bank workers have been granted a 521% wage hike year-on-year in line with the inflation that is eroding earnings.
The new salary threshold that was backdated to January was agreed to last week by the Banking National Employment Council (Nec) comprising the Banking Employers Association of Zimbabwe and the Zimbabwe Banks and Allied Workers Union (Zibawu) .
This will see the lowest paid employee getting $5 815,67 from $936,50 while the highest paid gets $8 296,93 up from $1 336,06.
The salary review is for the non-managerial bank workers only.
A communiqué signed by Nec read: “This further agreement made and entered into in accordance with the provisions of the Labour Act Chapter 28:01 by and between the banking Employers Association of Zimbabwe herein after referred to as the employers of the part and the Zimbabwe Bankers and Allied Workers Union.
“Being parties to the National Employment Council for the banking undertaking to amend the principal collective bargaining agreements contained in Statutory Instrument 273 of 2000 and Statutory Instrument 150 of 2013. Accordingly, the present collective bargaining agreement shall be read together with these two preceding agreement.”
Currency volatility and inflation which closed 2019 at 521% remains an impediment to economic stability.
Government last June reintroduced the inflation-prone Zimbabwe dollar ending a 10-year dance with the multi-currency system.
“In accordance with clause 6 of SI 150 of 2013, the parties hereby agree that the year-on-year inflation from agreed sources is 521%. The parties have, therefore, agreed to effect a 521% increase on the minimum,” the communiqué further read.
Last June, Zibawu went to court demanding banks to pay workers in hard currency; the matter is still pending.
Several banks have been downsizing as the economic downturn takes a huge knock on their operations. Banks’ principal source of revenue, net interest income has been dwindling due to fear of non-performing loans (NPLs).
NPLs went down to 1,75% at the end of 2019 from 6,92% prior year.
As such banks are predominantly relying on non-interest income derived primarily from fees that include deposit and transaction fees, insufficient funds fees, annual fees, monthly account service charges; inactivity fees, check and deposit slip fees.
Banks made an inflation-adjusted profit of $6,41 billion in 2019 from $430 million in prior year.
The country has 19 banking institutions that include
13 commercial banks, five building societies and one savings bank. – News Day